Belarusian authorities show little interest in higher turnout

The Belarusian authorities seek to keep the elections low-profile by censoring some critical speeches by opposition candidates and reducing candidates in number. In addition to organisational and financial constraints, the state media’s main task is to prevent politicisation of society. That said, the authorities are likely to ensure the turnout by early voting, especially given there is no threshold.

The authorities continued to reduce competition for the parliamentary seats by withdrawing some loyal candidates from pro-governmental parties and nomenclature. Apparently, initially high competition was due to the authorities’ desire to test if there were enough pro-government party candidates to replace the opposition and to steal some votes from the opposition candidates.

Due to financial constraints, the campaigning stage will last only two to three weeks. The candidates will be required to complete some formal, time and human resource-consuming procedures to register proxies, to coordinate campaigning venues, opening bank accounts, fundraising and printing campaigning materials. Candidates have very modest opportunities for campaigning on the national TV - only five minutes and five minutes more if there is a debate. In addition, there has been almost no coverage of the upcoming elections (up to 2% of the broadcast) and personalities of the candidates have been ignored completely. That said, candidates’ speeches on TV would not be uploaded on the Internet, unlike in 2012 and in 2015.

Censorship of candidates’ speeches has not been harsh by the Belarusian standard, however, it has occurred when candidates raised topical issues, such as the NPP construction. Compared with pro-governmental candidates, the opposition candidates appear more competent, including campaigning skills, speeches, leaflets, pickets and other campaigning materials, which could explain the authorities’ desire to keep the elections as low profile as possible with minimal media coverage.

The authorities are likely to preserve a relatively high pluralism in the ongoing parliamentary campaign, while keeping the campaign low profile for the population. Politicization risks predispose election officials in favour of using administrative resources in order to ensure the minimum required turnout and a sterile composition of the Parliament.

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Growth in real wages may disrupt macroeconomic balance in Belarus

October 02, 2017 12:12

Фото: Дмитрий Брушко, TUT.BY

The rapid increase in wages has led to a decline in the ratio between labour productivity and real wages to one. Previously, the rule was that enterprises, in which the state owned more than 50% of shares in the founding capital, were not allowed increasing salaries if this ratio was equal to or less than one. The authorities are unlikely to be able to meet the wage growth requirement without long-term consequences for the economy. Hence, the government is likely to contain wage growth for the sake of economic growth.

According to Belstat, In January – August 2017, GDP growth was 1.6%. The economic revival has led to an increase in wages. In August, the average monthly wage was BYN 844.4 or USD 435, i.e. grew by 6.6% since early 2017, adjusted for inflation. This has reduced the ratio between labour productivity and real wages from 1.03 in January 2017 to 1 in the first seven months of 2017. This parameter should not be less than 1, otherwise, the economy starts accumulating imbalances.

The need for faster growth in labour productivity over wage growth was stated in Decree No 744 of July 31st, 2014. The decree enabled wages growth at state organizations and organizations with more than 50% of state-owned shares only if the ratio between growth in labour productivity and wages was higher than 1. Taking into account the state's share in the economy, this rule has had impact on most of the country's key enterprises. In 2013 -2014 wages grew rapidly, which resulted in devaluation in 2014-2015.

Faster wage growth as compared with growth in labour productivity carries a number of risks. Enterprises increase cost of wages, which subsequently leads to a decrease in the competitiveness of products on the domestic and foreign markets. In construction, wholesale, retail trade, and some other industries the growth rate of prime cost in 2017 outpaces the dynamics of revenue growth. This is likely to lead to a decrease in profits and a decrease in investments for further development. Amid wage growth, the population is likely to increase import consumption and reduce currency sales, which would reduce the National Bank's ability to repay foreign and domestic liabilities.

The Belarusian government is facing a dilemma – either to comply with the president’s requirement of a BYN 1000 monthly wage, which could lead to new economic imbalances and could further affect the national currency value, or to suspend the wage growth in order to retain the achieved economic results. That said, the first option bears a greater number of negative consequences for the nomenclature.

Overall, the rapid growth in wages no longer corresponds the pace of economic development. The government is likely to retain the economic growth and retrain further growth in wages. Staff reshuffles are unlikely to follow the failure to meet the wage growth requirement.